Graphic Business News

Cedi slides ahead of yuletide fever

By: Graphic Business
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THE cedi tumbled against all the three major trading currencies in the week ending November 17 as pressure from increased imports for the yuletide mount on the local currency.
THE cedi tumbled against all the three major trading currencies in the week ending November 17 as pressure from increased imports for the yuletide mount on the local currency.

THE cedi tumbled against all the three major trading currencies in the week ending November 17 as pressure from increased imports for the yuletide mount on the local currency.

Although the dollar registered its biggest weekly loss in 2017 on the international currency, the cedi was still unable to hold its own against the United States (US) currency.

The cedi lost 0.07 per cent to the dollar, mainly as a result of uptick in demand of the greenback on the domestic economy to meet corporate repatriation and other seasonal pressures.

It thus traded at GH¢3.40 per dollar, which corresponds to a year-to-date depreciation of 4.65 per cent.

The United Kingdom (UK) pound also closed in the red for the second consecutive week in November on the international currency market due to lack of progress in the ongoing Brexit negotiation.

In spite of this, the cedi failed to ride on this development due to pressure from the domestic market as traders’ demand for foreign currencies prior to the upcoming festive season.

The cedi thus recorded a week-on-week depreciation of 0.02 per cent to trade at GH¢5.8 per pound.

The year-to-date depreciation of the cedi thus worsened to 11.68 per cent.  

The more-than-expected readings on Germany’s economy helped the 19-bloc currency to close bullish on the international currency market. This upbeat development boosted the value of the euro against a basket of currencies.

 The cedi thus succumbed to this pressure, depreciating by 1.15 per cent to trade at GH¢5.18 per euro.

The year-to-date depreciation of the cedi stood at 16.78 per cent. 

Treasury securities  

At the end of the November 17 auction, yield on the 91-Day T-Bill declined by four basis points to settle at 13.29 per cent.

The rate-of-return on the 182-Day T-Bill also eased by six basis points to settle at 13.81 per cent.

The yields on the other treasury securities, however, remained unchanged.

At the end of the auction, the government accepted GH¢598.26 million worth of bids out of the GH¢640.30 bids tendered.

The accepted bids were, however, below the government’s target of GH¢948 million.

Most of the government’s purchases were the short-dated treasury securities; the 91-Day and 182-Day T-bills accounted for 90.72 per cent of the total bids accepted.

Equity market

The Ghana Stock Exchange (GSE) closed the week’s trading on a positive note, as demand for financial stocks buoyed, following recent release of third quarter financial statements.

With most trading session ending positive, the GSE Composite Index upturned by 4.69 per cent to settle at 2,520.87 points.

This represents a year-to-date performance of 49.24 per cent. The GSE Financial Stock Index also rose by 7.36 per cent to close the trading session at an index point of 2,212.81 points.

It had a corresponding year-to-date return of 43.19 per cent. 

Total trade

Total trade stood at 2.06 million shares valued at GH¢8.06 million.

This represented 53.08 per cent declines over previous week’s total trade, which was estimated at 4.39 million shares valued at GH¢8.17 million.

Societe Generale Ghana Ltd, Ecobank Ghana Ltd and Enterprise Group Ltd emerged the most actively traded stocks. They accounted for 73.19 per cent of the total traded volume.

Ecobank Ghana Ltd, however, made the largest contribution to the week’s total traded value as it accounted for 39.38 per cent of the total. Market capitalisation, however, increased by 1.24 per cent to settle at GH¢58.8 billion.

Price movement

At the close of trading, price changes were recorded in nine equities. On the list of advancers, shareholders of Standard Chartered Bank Ltd made the most gains, as their share price advanced by GH¢4 to close at GH¢25.5 per share.

The Agricultural Development Bank also recorded its first ever price uplift in 2017 with 97 gains to trade at GH¢4.8 per share.

Access Bank Ghana Plc and Benso Oil Palm Plantation Ltd gained 17 pesewas and five pesewas to trade at GH¢3.57 and GH¢6.05 per share respectively.

Unilever Ghana Ltd and Ecobank Ghana Ltd also increased by two pesewas and a pesewa to trade at GH¢12.66 and GH¢7.55 per share respectively. 

On the flip side, Societe Generale Ghana Ltd and Mechanical Lloyd Company Ltd declined by a pesewa each to trade at 74 pesewas and seven pesewas per share respectively. 

Commodities

Crude oil recorded its first weekly loss in six weeks due to investors’ concerns of the draw back of the Russian government to support the production cut decision.

The price of Brent crude oil thus lowered by US$1.38 to settle at $ 62.14 per barrel.

Gold moved higher in the week’s trading on the back of demand uptick created by the soft dollar, following uncertainties associated with the commencement of an investigation into Russian’s involvement in recent US general election.

The precious metal added US$12.12 to trade at US$1,286.32 per ounce.

The price of Cocoa went down on the international commodity market as favourable climatic conditions at top grower Côte d'Ivoire sparked selling pressure.

Cocoa shed US$85.50 to trade at US$2,137.50 per tonne.

The price of coffee ended lower as compared to previous week’s closing value.

The soft crop thus tumbled by two cents to settle at US$1.25 per pound. — IGS Financial Services/GB